Today Cassava Smartech disrupted themselves.
EcoCash, Zimbabwe’s biggest mobile money service with a market share of 97% has been the de facto cash in Zimbabwe for a very long time. In terms of retail payments, that is daily payments between individuals and individuals or individuals and merchants, their only rival is Zimswitch, the interbank transaction switching platform.
The biggest reason why EcoCash has not really cared to heed calls to be interoperable with other mobile money platforms is that they are a platform themselves and they already have the dominant position in the market. They own the users.
Now, Sosholoza, the new service announced by Steward Bank takes away that dominance from EcoCash. Sosholoza allows an individual to send money from any bank or wallet to any other bank or wallet without going through hoops. This makes EcoCash just another wallet.
What EcoCash did has been done to it
EcoCash aggregated basically all banks onto itself. When it did that, banks became indistinguishable from each other. It didn’t matter what logo or colours your bank has, a ‘bank to wallet’ transaction was just that.
Now, with Steward Bank’s Sosholoza, banks are still indistinguishable from each other. Mobile money providers are also now indistinguishable from each other and for the first time this includes EcoCash. Lack of interoperability forced a lot of people to have two SIM cards: one for the mobile operator of their choice (usually NetOne) and one for EcoCash.
Sosholoza means such people can easily just have their NetOne SIM and they are set. They can send money to their mother who is on EcoCash from their OneMoney account right on WhatsApp. Their friends who have EcoCash can also send them money directly into their OneyMoney account.
On this platform, users will not care which bank they or their transaction partners have. All that will matter is that they have a Sosholoza account. Banks and mobile wallets have just become commodities.
EcoCash commoditised banks, now a bank, Steward Bank has commoditised EcoCash.
A bigger EcoCash
Sosholoza has potential to become far bigger than EcoCash could have ever been. It’s a combination between EcoCash and Zimswitch and it’s available on the most ubiquitous platform in Zimbabwe after the mobile phone itself: WhatsApp.
What Cassava has done is extremely hard
It’s very rare for a company to disrupt itself. Usually new products are always thought of as props for the super star products. This is how Microsoft missed the opportunity of the internet in the early 2000’s. New products are usually ‘not permitted’ to compete or to take glory away from the rock star products. The Cassava group did not fall into this trap.
Cassava Smartech’s organisational structure helped it achieve this feat. They did not house Steward Bank and EcoCash as mere products under one roof. They are separate companies that have separate objectives. Now, instead of EcoCash being disrupted by an outsider, it has been overrun by it’s own sister. That’s great news for Cassava shareholders although it may be a bitter pill for executives in EcoCash, Cassava or even in their associate Econet to swallow.
Hat off to Lance Mambondiani
Steward Bank’s CEO, Lance Mambondiani has always wanted to build a platform, now he has. He has always described Steward Bank as a fintech company with a banking license, now they are. If they really do their homework, they will be Zimbabwe’s most important transaction platform in a very short space of time and for a very long time until the next disruptor comes along.
One of the things they need to do quickly is to migrate the early Sosholoza users from WhatsApp to their own custom app. When you build something like this, you don’t want to build it on top of someone else’s platform who can easily change goal posts on you. You must own the customer relationship yourself.